Korean farmers hit with high feed prices

Oversupply of homebred cows also causing beef cattle prices to drop

Korean farmers have recently been hit by rising animal feed prices, and a fall in beef cattle prices caused by an oversupply of homebred cows.

The number of Korean beef cattle rose to 2.92 million in 2009 and has now reached 3.3 million, the result of a 2008 mad cow disease outbreak that caused consumers to turn to Korean beef, increasing the number of Korean livestock farmers involved in cattle breeding.

Consumption of Korean beef has declined as consumers have switched back to cheaper imported beef, but international grain prices have risen, driving up animal feed prices by 16%. With cattle currently sold at much lower rates from farms, distribution costs are estimated to account for about half of beef prices.

The Ministry of Agriculture said it has reached an agreement with the Defense Ministry to serve soldiers more domestic beef and less imported meat to help mitigate damages. The ministry also said it will provide incentives of between 300,000 and 500,000 won for farms that slaughter female cows.